INFORMATIONAL

TO:

Division Superintendents

FROM:

JoLynne Demary
Acting Superintendent of Public Instruction

SUBJECT:

2000-2002 Biennial Budget as Introduced

Governor Gilmore presented his 2000-2002 biennial budget to a joint meeting of the
Senate Finance Committee, the House Appropriations Committee, and the House Finance
Committee on December 17, 1999. This budget will be considered by the 2000 Session
of the General Assembly, which is scheduled to convene on January 12, 2000.
The Governor's recommendations include full funding for the state's share of the
Standards of Quality (SOQ), continuation of all existing programs, and additional
funding for several new initiatives. Attachment A provides detailed descriptions of
the funding proposed by the Governor. In summary, the proposed budget includes funds
to achieve the following objectives:
· expand the Early Reading Intervention program to include grades kindergarten through 3;
· provide a new program for math remediation in grades 7 and 8;
· distribute Literary Fund revenues for technology grants;
· develop and field test additional SOL test questions;
· provide electronic copies of SOL test results;
· provide item analysis of SOL test results;
· pilot the new alternative route to teacher licensure;
· provide mentor teachers for individuals who enter the teaching profession through
the alternative route to licensure;
· provide special education services in local jails; and,
· provide academic review teams for schools that are accredited with a warning.
Also attached is a printout that reflects the estimated entitlements from the major
SOQ and related accounts that your locality will receive in fiscal year 2001, which
begins July 1, 2000, and ends June 30, 2001 and fiscal year 2002, which begins July 1,
2001, and ends June 30, 2002.
This printout does not include the categorical programs that are funded on a reimbursement
basis. Likewise, it does not include the direct grants unique to certain school divisions,
which are authorized by the General Assembly. The Governor's budget includes continued
funding for these programs, but estimates of the distributions by school division have
not been computed at this time. The categorical accounts will be included in the
entitlement tables at the conclusion of the General Assembly session. For planning
purposes, you should continue to use the amounts provided to you for fiscal year 2000
in Regulatory Superintendent's Memo. No. 1, dated March 3, 1999. These accounts are
categorized as Group III accounts.
It is important to remember that this information relates to the Governor's budget as
introduced. It is subject to change as the House of Delegates and the Senate prepare
amendments to the Governor's budget. A final budget will be adopted by the General
Assembly in mid-March 2000. Therefore, the estimated entitlements contained in this
memorandum are only projections and are subject to change throughout the session. We
will provide additional information during the process as changes occur.
If you have questions, please contact Dan Timberlake, assistant superintendent for
finance, or the Budget Office staff at (804) 225-2025.
JLD/kmr:pft
Attachments: A hard copy of this memo and its attachment
will be sent to the superintendent's office.
s:\budget\2000-2002 budget\governor's introduced budget supts memo no 226.doc
Details of Governor Gilmore's Introduced Budget
for 2000-2002
Existing Programs
· Update SOQ and Related Accounts -- The Governor's budget includes $245.3 million
in fiscal year 2001 and $301.9 million in fiscal year 2002 to fully fund the state's
share of the Standards of Quality programs. The data elements used to develop the
SOQ budget were updated using the most recently verified data and are provided on
Attachments B and C.
The budget also includes an additional $12.8 million in fiscal year 2001 and $17.0
million in fiscal year 2002 to fully fund existing incentive-based programs and
required categorical programs. Projected entitlements for the incentive-based accounts
are included on the attached entitlement distribution sheet.
· Update ADM, Sales Tax, School Age Census, and Composite Index --The proposed budget
reflects funding necessary to cover increases/decreases in projections of March 31,
2001, and March 31, 2002, Average Daily Membership (ADM). The projected ADM was
forecast by the Department of Education based on September 30, 1999, Fall Membership.
On a statewide basis, these projections are lower than those used to develop the Board
of Education's proposed budget that was adopted in July 1999. In addition, all other
accounts that use Fall Membership data in their calculations have been updated based
on the September 30, 1999, totals.
The estimated entitlements also reflect the most recent one-cent sales tax estimates,
as computed by the Department of Taxation. The Department of Taxation projects revenues
of $783.8 million in fiscal year 2001 and $834.6 million in fiscal year 2002. The
data that was reported in the 1999 School Age Census was used to distribute the sales
tax. The projected entitlements were calculated using the 2000-02 composite indices
provided via Informational Superintendent's. Memo. No. 213, dated November 23, 1999.
· Change Use of Lottery Proceeds -- Funding for the distribution of lottery proceeds
will continue in the 2000-2002 biennium at relatively the same levels provided in
fiscal year 2000. Governor Gilmore has recommended eliminating the requirement that
50 percent of these revenues must be used for school construction, additions,
infrastructure, site acquisition, renovations, technology, expenditures related to
modernizing classroom equipment, or debt service payments. This change means that
100 percent of the lottery revenues may be used for any educational purpose. All
other provisions related to the lottery revenues continue in the 2000-2002 biennium.
The base year for the maintenance of effort requirement has been updated to fiscal
year 1998.
· Reduce Student to Teacher Ratio -- Legislation passed by the 1999 General Assembly
reduced the division-wide student to teacher ratio to 24 to 1 in kindergarten through
grade 3. As a result, basic aid per pupil amounts increased and the 24 to 1 tier
of the Primary Class Size Reduction Program was eliminated.
New Education Funding Initiatives
Governor Gilmore included funding for several new initiatives in his budget. Except
as otherwise noted, the funding amounts represent biennial totals.
· Web-based Computerized System -- $101.3 million ($95.0 million for school divisions)
to establish a computer-based instructional and testing system to support the
Standards of Learning. This program will provide funding for high schools to improve
their instructional, remedial, and testing capabilities. The program will provide
funding to reach a goal of one computer for every five students in high school and
internet access for all high schools. Funding is also provided for instructional,
remedial, and testing software and license fees and also for training. The majority
of the funding ($84.7 million) will be provided from the Literary Fund. Approximately
70 percent of the Literary Fund grants will be distributed on a per school basis for
eligible high schools. Eligibility will be based on whether or not the school has
met the stated goals of the program. The remaining 30 percent will be distributed
on a per pupil basis for all students reported in grades 9 through 12 without regard
to the eligibility of the affected school.
In order to receive this funding, divisions will have to certify that they intend to
administer computerized SOL tests by May 1, 2003. School divisions must also commit
to reviewing any purchased software applications and report the results to the Department
of Education so that this information can be shared with the Best Practice Centers and
high schools across the state.
The initiative also includes funding from the General Fund, which will be distributed
among localities on a per pupil basis. The General Fund distributions will help pay
for recurring costs such as T1 line charges, on-site support, and training. In order
to receive the General Fund portion of the funding, localities must provide a match
based on the composite index of local ability-to-pay. The Literary Fund portion of
the distribution does not require any local matching funds.
· Expand the Early Reading Intervention Program -- $17.1 million ($15.5 million for
school divisions) to expand the existing Early Reading Intervention Program to
include all grades kindergarten through three. The goal of this program is to
improve student performance on all of the third grade SOL assessments and to help
all students read on grade level by the third grade. The funding methodology
remains similar to that of the existing program, which is based on 2.5 hours of
additional instruction per week at a ratio of one teacher for five students for an
estimated number of eligible students. Currently, the percent of students eligible
for the federal free lunch program is used to estimate the number of students eligible
for this program. In the first year, this proposal funds services for:
1) 100% of the estimated students eligible in kindergarten;
2) 50% of the estimated students eligible in grade one;
3) 50% of the estimated students eligible in grade two; and
4) 25% of the estimated students eligible in grade three.
In the second year of the biennium, funding will be based on the actual number of students
needing services as identified by a diagnostic test. School divisions that elect to
participate in this program will be required to fund a local match based on the composite
index of local ability-to-pay.
· Math Intervention Program -- $9.8 million ($9.1 million for school divisions) in
fiscal year 2002 to fund a program for seventh and eighth grade students who require
remediation in order to pass the eighth grade math SOL assessment. The program will
provide additional instruction to students who are identified with deficient math
skills via local or state-provided tests. The program provides funding for 2.5 hours
of additional instruction per week for an estimated number of students based on a
student-to-teacher ratio of ten to one. The number of students eligible will be
estimated based on the percent of students failing the eighth grade math SOL test.
Localities receiving these incentive funds will be required to provide a match based
on the composite index of local ability-to-pay.
· Mentor Teacher Program/Alternative Licensure Program -- $809,797 ($400,000 for
school divisions) to expand the current mentor teacher program and to train
professionals who are not currently certified to teach in public schools. These
programs will help address the teacher shortage in math, science, and technology
fields by allowing divisions to hire nontraditional classroom instructors and to
support such individuals through mentor relationships with veteran teachers. The
program assumes that 100 new teachers will be hired and provides $1,000 for training
and materials for each new teacher and a $1,000 stipend for each veteran teacher who
serves as a mentor.
· Funding for Incarcerated Special Education Students -- $3.4 million to provide
special education services to students housed in regional and local jails, as
required by the federal Individuals with Disability in Education Act (IDEA) regulations.
The state will pay 100 percent of the cost for these programs.